Gap beats by $0.14, reports revs in-line, comps +1%; guides FY25 revs above consensus
- Reports Q3 (Oct) earnings of $0.72 per share, $0.14 better than the FactSet Consensus of $0.58; revenues rose 1.6% year/year to $3.83 bln vs the $3.81 bln FactSet Consensus.
- TOTAL CONSOLIDATED COMPS: +1%
- Same Store Comps by segment:
- Old Navy flat: Sales of $2.2 billion were up 1% compared to last year. Comparable sales were flat. The brand's continued focus on operational rigor and brand reinvigoration drove solid performance in the quarter, despite lapping tougher compares and facing weather-related headwinds.
- Gap +3%: Third quarter net sales of $899 million were up 1% compared to last year. Comparable sales were up 3% representing the fourth consecutive quarter of positive comparable sales at the brand. Gap's strong product and marketing execution have helped drive continued momentum and consistent results at the brand.
- Banana Republic -1%: Third quarter net sales of $469 million were up 2% compared to last year. Comparable sales were down 1%. The brand saw strength in its men's business during the quarter and remains focused on fixing the fundamentals.
- Athleta +5%: Third quarter net sales of $290 million were up 4% compared to last year. Comparable sales were up 5%. As expected, the brand returned to positive comparable sales in the quarter as its new product and marketing are resonating with customers.
- Co issues upside guidance for FY25, sees FY25 revs being up +1.5-2.0% vs prior guidance of "up slightly." We compute new guidance as $15.11-15.19 bln vs. $14.95 bln FactSet Consensus.
- Co raises FY24 gross margin guidance to +220 bps from +200 bps prior guidance.
